Abstract: The impact of social capital on employment is a well-researched topic. However, there is little consensus over whether social capital brings definitive better outcomes. This paper places its focus on middlemen employment agents rather than on job seekers to examine the effects of social capital in labor market. We found that how well social capital can be utilized is often determined by the efforts of middlemen agents. Referral commissions are positively associated with the frequency of information distribution by agents but not necessarily result in better quality of recommended candidates. Contrary to the "social resource theory" proposed by Lin Nan, education level and self identified social status show limited impact. It implies that agents with high social status and rich resources do not necessarily share employment information along class lines. Further investigation into the extra steps taken by agents to help their clients indicates that if client and agent is introduced by a third party, it is more likely that for the reason of cost effective, extra steps are requested by clients to ensure better results since they are often obliged to compensate not just the agent but the third party as well.It is also shown that agents are more willing to take extra steps if clients have lower educational level than themselves. Also female job seekers are less likely than their male counterpart to use informal channels to find matching jobs. The study also finds that job seekers with lower expectation tend to look for work through networks. These results suggest that first, companies using referral commission for recruitment should consider other options of incentive to secure better quality of service from intermediaries. Second, instead of limiting research on the dichotomy of strong vs weak network, future studies need to pay more attention to the different combination of social ties in studying network effects. Finally, the psychological factors that influence the decision making process of job seekers should also be taken into consideration.

Key words: employment, intermediary, social capital, labor market